How growth can benefit the masses

On Wednesday last week, the Uganda Bureau of Statistics (UBOS) published results of its National Household Survey which showed that the proportion of people living in poverty has declined from 31 to 23%. It was good news for President Yoweri Museveni who had just been nominated as presidential candidate. Now he can build his campaign on this performance legitimacy.

Most of Museveni’s critics will rush to claim that these figures are cooked. Yet they must be a fair reflection of the changing conditions of the citizens of this country. This is because despite its weaknesses, UBOS is a fairly competent, reliable, professional and independent body in gathering and assembling vital statistics about our economy. Second, evidence from many other economic indicators ‘ tax revenues, import expenditure, export receipts, number of banks and their branches, mobile phone usage, litres of beer and soda sold per day, quantity and quality of cars on our roads, number and value of houses etc ‘ shows that there is impressive growth.

Yet the Museveni administration presents us an analytical puzzle. Basing on conventional wisdom, we should expect that increasing state revenues would improve both the financial and the institutional capacity of the government to deliver public goods and services. This would be buttressed by the democratising effects of growing personal incomes and the spread of education i.e. the creation of a large middle class with a vested interest in a democratic politics that is citizen centred.

However, increasing government revenues have gone hand in hand with a rapid decline in the capacity of the state do deliver public goods and services. So, our roads are full of potholes, our public hospitals and schools are crumbling under the weight of disrepair and negligence, the quality of public education and health services is appalling, law enforcement by the police is weak and city authorities cannot perform basic functions like garbage collection. In almost every routine service by the state, there is rampant corruption, absenteeism, incompetence and indifference.

Many Ugandans attribute this to dictatorship; others to ‘sham democracy’. Yet most evidence shows that it is democracy, or at least the peculiar way in which it is evolving in our country, that undermines the capacity and autonomy of the state to be an effective agent of service delivery. Uganda punches far above its weight in almost every indicator of democracy except the tenure in office of our president. This is especially so given our level of per capita income.

Thus, whether it is press freedom, regular elections, multiplicity of political parties and civil society organisations, this country has a lot of democratic activity. Sixty percent of incumbent MPs fail to get re-elected; so voters hold leaders to account.Â In the long term, it is possible that increasing incomes combined with an expanding educated middleclass may lead to a more effective and autonomous state. However, that is not a guarantee. For now, we need to explain why it’s not happening in the short term.

Democracy in Uganda has evolved in the context of a poor and semi-literate voting population. Consequently, our politicians find it cheaper to win votes by distributing small favours to voters ‘ rice, sugar, soap, salt and meat ‘ in exchange for their votes instead of promising delivery of public services. Public policy promises are difficult and expensive to deliver; and their results come at a later date. So they are uncertain. Meanwhile, the aforementioned small gifts can be delivered there and then. So they are certain.

Most voters in Uganda have settled expectations about what can come from the political process. They know from experience that once elected, MPs accumulate personal wealth from their jobs while public goods and services do not improve much. Therefore, voters insist that candidates pay for their promises in advance. Thus voter bribery is not actually corruption but its opposite; it is the way voters hold politicians to account. However, this reality cannot be seen this way because most analysis in Africa is based on an imported theory of corruption that has little relevance to our context.

Thus, the democratic system that has evolved in Uganda is one where the political marketplace has candidates as buyers of votes and voters as sellers of their right to public services. This perverted system of accountability has evolved in response to a specific incentive structure i.e. poverty and mistrust of state action. So corruption is not just a negative side effect of the political process; it is the system. It is not merely aimed at personal enrichment (even though it manifests itself that way). It is a social system through which political power is organised, exercised and reproduced.

It is by understanding this inner dynamic of the political system that we are able to explain why many Ugandans do not believe that poverty is reducing. People cannot reconcile collapsing public infrastructure and atrocious public services with reducing poverty. Yet this contradiction is the inevitable result of the way the system works, not the way it fails. The preference for the provision of private goods in exchange for political support is an inefficient way of distributing the rewards of economic success.

For example, assuming Uganda had a health budget of one billion US dollars and instead of the state building hospitals and hiring medical staff it decides to divide it among all the citizens of the republic. Every Ugandan would get $30 per year. That is not enough to ensure that those who fall ill get treated. Public healthcare works well when institutionalised because fewer people get ill every year vis a vis the total population. It is like insurance ‘ the healthy foot the bills for the ill by pulling resources.

Thus assuming only five percent of 31 million Ugandans fall sick every year; that is only 1.5 million people. This means that every Ugandan who falls ill would get US$ 666 worth of medical treatment expenditure ‘ enough to meet most sick people’s bills. In most of Africa, public institutions no longer embody this collective vision. Instead they reinforce a pattern of private advantage that gives privileges to a few elites at the expense of masses. Africa needs more conversation about this aspect of our politics.